The IRS knows that there are over 7 million individuals and businesses with unfiled tax returns.
A significant percentage of that number constitutes taxpayers who have not filed tax returns for multiple years. The IRS is beginning an initiative to target these “non-filers.”
If you come into our Buckhead – Sandy Springs CPA firm to resolve the problem of missing tax returns for you or your business, we will be sure to discuss with you three key strategies for non-filers.
Tax Return Preparation Strategies
1.) How Many Years to File? – No matter how many years of returns have not been filed, the IRS only requires you to file six years of missing tax returns.
2.) How Are You Going to File? – If you can’t afford to pay your back taxes, consider filing separately from your spouse, followed by an Offer in Compromise. This may save you thousands of dollars, depending on your fact pattern.
3.) Which Returns to File First? – Supercharge your Offer in Compromise for back taxes by filing your state returns first. This, too, may save you thousands of dollars, depending on your facts and circumstances.
Getting into Tax Compliance
In order to work out any kind of a deal with the IRS, the taxpayer must be in tax compliance. This means that all tax returns must be filed (for the past six years). And the taxpayer must be making their current tax payments. This includes quarterly estimated tax payments if the taxpayer has a business or is an independent contractor.
Furthermore, it the taxpayer does make a deal with the IRS, the deal will be contingent upon the taxpayer staying in compliance. If they fail to do so, they will be in default on their deal with the government and they will have to start negotiating a new deal from the beginning. And the IRS is likely to be less than cooperative with someone who has already defaulted once on a deal.
Georgia CPA Reminder: If you own a business, the bookkeeping and accounting needs to be completed before your tax returns can be prepared. Our Atlanta accounting firm handles the books for many small business throughout Georgia. So call us as soon as you can to get caught up and stay compliant with the IRS!
Unfiled tax returns are an urgent matter. Especially if you want to stay out of trouble with the IRS.
And remember, if tax returns are not filed, the penalties and interest will quickly add up. So don’t wait!
Founded by Gary Massey, Massey and Company is a boutique CPA firm located in Atlanta, Georgia serving the tax and accounting needs of small businesses and individuals throughout Georgia.